Bonds, are they worth it?

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Amazin
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Bonds, are they worth it?

Post by Amazin » Thu Jan 08, 2015 5:17 pm

Apparently Warren Buffett is not a fan of them. They're also heavily influenced by inflation over time and you might not get access to your money for while. I don't mind wait for something like 2 years to access that money but i think 5 years is too long.

anyone on here are investing in bonds atm?

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mhc
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Re: Bonds, are they worth it?

Post by mhc » Thu Jan 08, 2015 5:39 pm

I use a total bond market fund in my 401k similar to Vanguard's Total Bond Market Index Fund. It returned just shy of 6% last year. No complaints here.

If you use a bond fund, you can get in and out as you like (within reason).

Rob Bertram
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Re: Bonds, are they worth it?

Post by Rob Bertram » Thu Jan 08, 2015 5:41 pm

Do you mean individual bonds or bond funds? I invest in bond funds and think that they are a good diversification from stocks. Outside of I-Bonds, I don't think I'd ever invest in an individual bond.

LateStarter1975
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Re: Bonds, are they worth it?

Post by LateStarter1975 » Thu Jan 08, 2015 5:42 pm

mhc wrote:I use a total bond market fund in my 401k similar to Vanguard's Total Bond Market Index Fund. It returned just shy of 6% last year. No complaints here.

If you use a bond fund, you can get in and out as you like (within reason).
This
Debt is dangerous...simple is beautiful

dbr
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Re: Bonds, are they worth it?

Post by dbr » Thu Jan 08, 2015 5:45 pm

Amazin wrote:Apparently Warren Buffett is not a fan of them. They're also heavily influenced by inflation over time and you might not get access to your money for while. I don't mind wait for something like 2 years to access that money but i think 5 years is too long.

anyone on here are investing in bonds atm?
Not sure where you think you might not get access to your money for as long as years. Second answer is that almost everyone posting on this forum most likely holds some amount in a bond mutual fund, if not in I bonds or individual Treasuries such as TIPS. CDs of various maturities are probably held by many, though not strictly bonds. Most CDs can be redeemed if at a penalty.

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Ged
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Re: Bonds, are they worth it?

Post by Ged » Thu Jan 08, 2015 5:46 pm

Bond funds are the way to go unless you are playing with 8+ figures.

supernova
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Re: Bonds, are they worth it?

Post by supernova » Thu Jan 08, 2015 5:52 pm

Buffet actually likes short term treasuries (he says to have 10% of your investment cash in them). Then again he also has too much money for a bank account...

Van
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Re: Bonds, are they worth it?

Post by Van » Thu Jan 08, 2015 6:13 pm

Bonds are a good way to try to keep up with inflation (and maybe do a little better), if you have accumulated all that you will ever need and don't need or want to take on a lot of risk.

Amazin
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Joined: Tue Oct 28, 2014 4:46 pm

Re: Bonds, are they worth it?

Post by Amazin » Thu Jan 08, 2015 6:21 pm

oh I wasn't referring to bond fund, I was thinking of individual bonds. didn't even know bond fund existed lol

so I take it indivudal bonds are not popular on here then...

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Zapped
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Re: Bonds, are they worth it?

Post by Zapped » Thu Jan 08, 2015 6:33 pm

Amazin wrote:oh I wasn't referring to bond fund, I was thinking of individual bonds. didn't even know bond fund existed lol
Here's a good reference on the topic of individual bonds versus bond funds -
http://www.bogleheads.org/wiki/Individu ... _bond_fund

On the right side of that wiki page you'll also see links that can teach you more about different types of individual bonds. At the bottom of the (lengthy) wiki page you'll find links to other forum discussions and some Vanguard white papers on the topic.
- Jim in Austin, TX

Ganacel
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Re: Bonds, are they worth it?

Post by Ganacel » Fri Jan 09, 2015 1:08 am

Amazin wrote:oh I wasn't referring to bond fund, I was thinking of individual bonds. didn't even know bond fund existed lol

so I take it indivudal bonds are not popular on here then...
I think most of us have some combination of bond fund(s) and no individual bonds except maybe Treasury securities (See http://www.bogleheads.org/wiki/United_S ... y_security). Those are the only individual bonds that I have.

Are you looking for advice on how to invest for a specific purpose and a specific time frame? We could give you better advice if you gave us more info.

Stan Dup
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Re: Bonds, are they worth it?

Post by Stan Dup » Fri Jan 09, 2015 9:57 am

Lots of easy to watch videos here on the wiki: https://www.bogleheads.org/wiki/Video:_ ... in_Minutes
"The tyranny of compounding expenses is the eighth deadly sin." - George Sisti

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